| A. Input Assumptions | |||
|---|---|---|---|
| Date of transfer | April 27, 2024 | ||
| Fair market value of property transferred | $1,000,000.00 | ||
| Nearest age on the date of the gift for Beneficiary 1 is | 65 | ||
| Date of first payment | December 30, 2025 | ||
| Annuity starting date (payment period before 1st payment) | September 30, 2025 | ||
| Annual annuity rate for immediate annuity | 5.5% | ||
| Payment frequency | Quarterly | ||
| Prorate first payment or Full first payment? | Prorate | ||
| Deferred annuity interest adjustment factor | 1 | ||
| Annual annuity rate adjusted for deferral | 5.5% | ||
| This table uses a hypothetical future discount rate of | 4.6% | ||
| The mortality table is based on the census taken in | 2000 | ||
| B. Present Value of Remainder Interest - One Life Deferred | ||
|---|---|---|
| 1. | Age nearest to date of transfer | 65 |
| 2. | Age nearest to annuity starting date | 66 |
| 3. | Value of Dx from IRS Pub. 1457, Table H based on | |
| (a) Line 1 age | 4158.562 | |
| (b) Line 2 age | 4420.171 | |
| 4. | Line 3(a) divided by Line 3(b) | 0.940815 |
| 5. | Unadjusted value of $1 of single life annuity from IRS Pub. 1457, Table S based on Line 1 age | 10.868 |
| 6. | Adjustment factor based on payment frequency from Pub 1457, Table K | 1.0171 |
| 7. | Adjusted value of $1 of single life annuity (Line 5 * Line 6) | 11.0538 |
| 8. | Value of $1 of deferred single life annuity (Line 4 * Line 7) | 10.3996 |
| 9. | Annual annuity rate for deferred annuity | 5.5% |
| 10. | Deferred annuity interest adjustment factor | 1 |
| 11. | Deferred annuity rate (Line 9 * Line 10) | 5.5% |
| 12. | Net fair market value paid for annuity | $1,000,000.00 |
| 13. | Annuity amount payable on an annual basis (line 11 * Line 12) | $55,000.00 |
| 14. | Present value of annuity (Line 8 * Line 13) | $571,978.00 |
| 15. | Minimum value of annuity (lesser of Line 12 and Line 14) | $571,978.00 |
| 16. | Present value of remainder interest. The tax deduction | $428,022.00 |
Depending on the type of asset you contribute, a portion of your payment may be taxable to you as a combination of ordinary income, long-term capital gain, and a tax-free return of principal. This report has been calculated assuming a contribution of cash. Each of your next 19.1 years payments of $55,000.00 will contain $29,946.49 of tax-free income and $25,053.51 of ordinary income. All income will be ordinary after 19.1 years.
IMPORTANT: The value of the remainder interest in line 16 must be greater than or equal to 10% of the value of the Fair market value of property transferred for the gift to pass the 10% remainder interest test. If it is not, no deduction is allowed.
NOTE: This calculation is provided for educational purposes only. The type of assets transferred, the actual date of the gift, and other factors may have a material effect on the amount or use of your deduction. You are advised to seek the advice of your tax advisors before implementing a gift of this type.
Calculations provided by EzCharitable, Copyright 2022 EzCharitable, LLC
